World’s first LNG onboard regasification port

February 20th 2007 saw the first ever flows of natural gas from a liquefied natural gas (LNG) ship directly into the onshore natural gas grid – the culmination of a remarkable 12 month project to create the fastest and lowest cost LNG importation facility in the world.

John Baldwin, senior consultant with UK gas consultants Gas Strategies, tells the story of the groundbreaking Teesside GasPort project.

Excelerate Energy

Throughout Europe and America, around 30 LNG importation terminal projects are being developed, including two new facilities at Milford Haven which will be completed in early 2008. A typical LNG re-gasification terminal takes five years from initial planning to completion and costs around £400 million, comprising at least
two LNG storage tanks and plant to regasify the LNG before exporting the gas into the high pressure gas grid.

One company has a different approach. Rather than investing £400 million in each regasification facility, Excelerate Energy has developed technology to allow the LNG to be converted back into natural gas onboard the ship, with natural gas going direct into the high pressure pipelines. It costs around £40 million extra to modify a standard LNG ship into an Energy Bridge Regasification Vessel (EBRV) to allow offloading of gas as high pressure gas, either via a connection into an offshore pipeline or, as at Teesside, to flow directly into the national gas grid.

So, for £400 million, Excelerate can have a number of ships, currently three in service with others being built in Korea to give a total fleet of nine ships by 2010 (eight EBRVs), and a number of access points such as Teesside, which also cost about £40 million each. This means that Excelerate can place regasified LNG into the highest value markets around the world – in Europe, North America or Asia without the necessity of having constructed a conventional LNG import and re-gasification terminal.

Why GasPort and why Teesside?

This successful outcome was by no means inevitable. The story begins in late summer 2005, when Excelerate was alerted to the rise in UK gas prices caused by the decline in North Sea production coupled with delays to the completion of new gas import infrastructure. Excelerate commissioned industry consultants Gas Strategies to identify a port in the UK that could accommodate Excelerate regasification vessels and allow a new source of gas to come to the UK market. Excelerate Energy and Gas Strategies reviewed all ports in the UK and selected Teesside based on:

• Sufficient water depth to accept a large LNG vessel (65,000 tonnes of LNG)

• Access to the UK gas grid – the National Transmission System (NTS)

• Jetty availability

• Source of high pressure nitrogen for gas blending purposes

• Favourable planning environment which allowed the possibility of a fast-track project

Excelerate Energy supported by Gas Strategies identified two possible locations on Teesside and carried out a detailed evaluation to identify the most appropriate site, culminating in the decision, in February 2006, to progress the development of a refurbished jetty located on the site of a former Shell oil refinery.

Given its history of receiving large vessels, a sufficiently deep berthing pocket was available alongside the jetty to accommodate the draught of the EBRVs. This limited dredging to restore the pocket to its design depth minimised the additional marine work required. At this time, Excelerate supported by Gas Strategies began discussions with the local port authority, PD Ports, for land and jetty access.

In the months following this decision, Excelerate retained MouchelParkman to provide eng ineer ing and development services, px Holdings Limited to provide operational services, Murphy Pipelines Limited to provide design and construction services and BOC Limited to provide nitrogen supplies to the project and Watson, Farley and Williams to provide legal support. This was the team that worked together to complete the facility by early 2008.

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In edition 34 of Port Technology International, we look at how fast-scan technology increases security and decreases bottlenecks; how WiFi technology is powering real-time intermodal operations at Deurganck terminal; and focus on the growth of the Baltic States, and development strategies for Lithuanian ports.

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